Recent corporate registration data shows that Lily Group Co.,Ltd. has completed its strategic investment in Shenzhen Qinghe Technology Co., Ltd., with the state-owned investment platform under BOE Technology Group participating in this funding round. This marks the formation of a stable industrial alliance connecting upstream pigment suppliers, midstream photoresist manufacturers, and a leading downstream panel capital platform. This equity tie-up is expected to break the long-standing fragmented development within China's display material supply chain, driving transformative changes across industry structure, domestic substitution progress, and corporate growth.

According to an industry report on the color photoresist sector, China currently holds 75% of global LCD panel production capacity, yet the domestic replacement rate for color photoresists is only 15%, and for specialized photoresist pigments, it falls below 10%. Japanese firms like DIC and Mikuni Color have long dominated the supply of high-end coloring materials, creating a dual bottleneck in both finished products and raw materials. Projections indicate that by 2027, domestic demand for photoresist pigments will reach 2,353 tons, corresponding to a market value of 3.53 billion to 7.06 billion yuan, leaving substantial room for domestic substitution. Lily Group Co.,Ltd. is one of the few domestic companies capable of stable, ton-scale production of electronic pigments specifically for photoresists, with core technologies in nanoscale pigment synthesis and high-purity impurity control. It has also planned a 2,000-ton production capacity for photoresist pigments. Qinghe Technology is a benchmark domestic color photoresist manufacturer, having built a 9,000-ton RGB color photoresist mass production line that meets or exceeds import-equivalent performance standards. Its core end-user includes BOE, which commands approximately 60% of the global market share.

Previously, the independent R&D and separate validation processes across the supply chain meant a full cycle for new material deployment took two to three years. Now, with this deep equity alliance, a joint R&D long-term mechanism is established. BOE provides optical standards for panel production lines, Qinghe opens its photoresist formulation system, and Lily Group Co.,Ltd. tailors pigment products accordingly. This integrated collaboration model can shorten product validation cycles by 30%.

Restructuring Industry Ecosystem and Reshaping Supply Chain Competition Logic

For a long time, domestic pigment companies lacked stable downstream channels, while photoresist manufacturers heavily relied on imported powder pigments, leading to fragmented efforts across the supply chain. This capital cooperation creates a model for upstream-downstream synergy, moving beyond simple transactional relationships. Research estimates that using domestic pigments instead of imported feedstocks can reduce raw material costs for photoresist companies by 15% to 20%. Relying on long-term, stable local supply, Qinghe's color photoresist products will gain significant cost performance advantages, while also forcing foreign pigment suppliers to adjust their pricing strategies in China, breaking the monopolistic pricing control of Japanese firms. Industry insiders suggest that future competition will shift from single-product performance to the comprehensive capability of the entire supply chain. Manufacturers that only produce finished photoresists but still depend on overseas raw materials will lose their competitive edge in bidding from major panel customers. Deep capital and technical integration across the supply chain will become a mainstream trend, accelerating industry resource consolidation.

Strengthening Upstream Core Weaknesses, Accelerating Self-Reliance in Display Materials

Previously, domestic substitution efforts for photoresists focused mainly on breakthroughs in finished products, leaving a significant gap in the supply of core upstream coloring pigments, preventing domestic color photoresists from achieving full independence. The equity tie-up between Lily Group Co.,Ltd. and Qinghe now bridges the complete domestic production chain—from photoresist pigments and nanoscale color pastes to color photoresists—addressing the weakest link in the upstream supply chain. Leveraging Qinghe's direct supply channel to BOE, Lily Group Co.,Ltd.'s self-developed electronic pigments will be prioritized for introduction into major panel manufacturers' mass production lines, changing the current situation where domestic materials are only used in small-scale trials. Currently, flat-panel display photoresists and supporting high-performance pigments are included in the first batch of key new materials for demonstrative applications, allowing this tripartite industrial alliance to benefit from policy support, iteratively improve product performance, and transition domestic pigments from "production capability" to "large-scale stable commercial use," capturing the multi-billion yuan pigment market substitution opportunity.

Securing Long-Term Stable Orders, Lily Group Opens a High-Margin Second Growth Curve

For Lily Group Co.,Ltd. itself, this investment resolves a core pain point in commercializing its photoresist pigment business. Before the cooperation, the company's electronic pigments were only sent for sporadic samples, lacking a stable, large-scale downstream market. After the equity tie-up, the two parties are expected to establish a priority supply agreement, directly connecting to BOE's substantial panel demand, significantly reducing the time and cost of customer acquisition and multiple rounds of validation. The company's 1 billion yuan high-performance organic pigment industrialization project includes dedicated production lines, with capacity aligned to Qinghe's expansion pace, following the 12% average annual growth rate of domestic color photoresists, effectively avoiding the risk of idle capacity from overexpansion. Compared to traditional pigments for coatings and inks, electronic pigments for photoresists offer higher added value. As supply scales up, it will consistently lift the company's overall profit margin. Supported by stable cash flow from its traditional pigment business and the differentiated barriers built through full-chain collaboration, Lily Group Co.,Ltd. is accelerating its transformation from a traditional cyclical chemical enterprise to an electronic materials platform company, increasingly highlighting its medium-to-long-term growth potential.

Industry analysts point out that the industrial alliance formed by Lily Group Co.,Ltd., Qinghe Technology, and Guoke Dongfang marks a milestone event in the full-chain localization of China's LCD display materials. As the tripartite cooperation deepens and supporting capacities gradually come online, the domestic LCD supply chain will progressively shed its reliance on overseas raw materials, laying a solid foundation for the security of the new display industry's supply chain.